The past twelve months were pivotal for the cannabis industry, as 2020 welcomed a myriad of triumphs, including:
- Essential business status during the COVID-19 pandemic
- Four U.S. states voting yes to recreational marijuana
- The U.S. House of Representatives' approving Marijuana Opportunity Reinvestment and Expungement (MORE) Act, a bill constructed to remove marijuana from the list of federally controlled substances
- The passing of a bill to reduce barriers and advance scientific research into medical cannabis.
- An increase in cannabis sales and record levels of tax revenue
- A European court ruling against restrictions on CBD commerce
- And an uptick in celebrity backing
So, what will 2021 bring? Benzinga reached out to a number of cannabis industry veterans to learn more.
2020 Was A Proving Ground
"From an industry perspective, we saw necessary culling of the poor operators and the acceleration of sustainable growth for the leading MSOs and ancillary companies in the U.S.," Emily Paxhia, managing director and co-founder of Poseidon Asset Management, said.
Strong sales trends underscored how 2020 was a "proving ground for cannabis" and was marked by "operations and focus on sustainable growth."
Paxhia advised investors to look at the leading MSOs like Curaleaf Holdings (OTCQX: CURLF), TerrAscend (OTCQX: TRSSF), Trulieve (OTCQX: TCNNF), Green Thumb Industries (OTCQX: GTBIF), and Cresco (OTCQX: CRLBF), who worked hard to advance their EBITDA margins in order to ensure long-term success.
"The days of raising capital on dreams, overpromising and underdelivering, should be behind us. Look at the massive wipeouts of iAnthus (PINK: ITHUF), MedMen (OTCQX: MMNF), Acreage (OTCQX: ACRHF), etcetera, who did just that," said Paxhia.
On the other hand, the industry did experience challenges imposed by the COVID-19 crisis. It was basically tested as a recession-proof product.
"Cannabis may be recession-proof, but cannabis companies are not," Paxhia said.
Paxhia expects to see more quality operators to go public in 2021, providing …